Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
not this time. Thanks.

Anyway, the initial point was whether deposits were still important or not. As a gentleman above pointed out, banks are in charge of CREATING credit nowadays, that means creating money outright. Most of the money coming out of banks is made that way, so some will view credit as the most important function of banks.

But that function cannot happen without banks having SOME capital. (The capital standards were developed by the international organization called the Bank for International Settlements, based in Basel, and famous, long ago for being kind to Nazis). Indeed if some loans fail, capital is needed.


Patrice Ayme Patriceayme.com Patriceayme.wordpress.com http://tyranosopher.blogspot.com/

by Patrice Ayme on Thu May 7th, 2009 at 12:04:50 PM EST
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